Tax Reduction?

10y

That's not that bad...are you paying city or state tax also?

Authored by: Certified Hedge Fund Professional - 3rd+ Year AnalystCertified Hedge Fund Pro

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Almost Human

10y

With that kind of salary you can't really do much to minimise your liabilities. Some of the more elaborate tax haven schemes would not be cost effective, you can't really classify your expenses as business expenses and you can't be paid as a corporation.

If you are saving for pensions etc, try and buy into a company / national scheme where deductions are made gross so you get the tax savings there.

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IBNazi

Orangutan

10y

At what salary do you think starting your own company to minimizes your taxes becomes feasible?

Once I did bad and that I heard ever. Twice I did good and that I heard never.

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Almost Human

10y

You need your company to agree to pay your company rather than you as an individual, which most will not do.

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Hooked on LEAPS

10y

I wonder why more companies don't do this? It's a fairly easy way to get around paying taxes.

I also wonder why more companies don't give stock as a bonus. I'd much rather risk holding onto a stock for a year and take a 15% tax on long term capital gains than know for a fact the government is gonna rape me out of half my paycheck. I think that's how it works anyway. I'm not an expert on the tax system.

Competition is a sin. -John D. Rockefeller

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Almost Human

10y

Also, 84k net from 120k is pretty good, that's like 30% tax.

See my other WSO blog posts>

packmate

Mentor

10y

Best Response

Hooked on LEAPS:

I wonder why more companies don't do this? It's a fairly easy way to get around paying taxes.

I also wonder why more companies don't give stock as a bonus. I'd much rather risk holding onto a stock for a year and take a 15% tax on long term capital gains than know for a fact the government is gonna rape me out of half my paycheck. I think that's how it works anyway. I'm not an expert on the tax system.

it's 20% cap gains now
There are stock options
you would rather hold a stock for a year that has no guarantee of appreciating in value(possibly depreciating) than cash, just so you can save a max 15-20% on taxes? Obviously it depends on the "stock compensation" you get, but your personal influence on the stock price would be almost non existent unless you were a C-level exec

Authored by: Certified Hedge Fund Professional - 3rd+ Year AnalystCertified Hedge Fund Pro

Hooked on LEAPS

10y

1) I thought it was 15% long term capital gains and a 3.5% Obamacare tax on anything over $200,000.

2) Most stock options are usually for C level people aren't they? I know most large companies have ESSP's but that is usually maxed after a certain percentage and don't you still have to pay income tax on it?

3) Yep, that's 100% right. I'd rather let it ride on pretty much any company than than lose a guaranteed ~50% to the government (pending you live in a place like NY). I'd never hold more than a year though for the sake of diversifying.

Competition is a sin. -John D. Rockefeller

heister

Human

10y

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